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story.lead_photo.caption The Arkansas Democrat-Gazette has distributed more than 10,000 Apple iPads in its effort to convert print subscribers into digital subscribers by the end of the year in counties where the newspaper circulates. - Photo by Jeff Mitchell

Walter Hussman hopes to convert Arkansas Democrat-Gazette print subscribers to digital by the end of the year in all 63 counties where the newspaper has traditionally been circulated.

That doesn't include the 12 counties served by the Northwest Arkansas Democrat-Gazette, which operates autonomously.

If all goes according to plan, the print edition of the Arkansas Democrat-Gazette would cease by the end of the year, except for Sundays, said Hussman, who is publisher of the newspaper and chairman of WEHCO Media, Inc.

The digital conversion has been in the works for a couple of years, but Hussman said "there's a lot of misunderstanding about it."

Hussman spoke to employees Friday about the digital shift. Shortly afterward, social media lit up with posts containing inaccurate information about the conversion.

Hussman is providing Apple iPads to subscribers so they can read a replica of the newspaper online. Hussman said he's prepared to spend $12 million on the tablet computers, which retail for $329 each before tax.

He has distributed more than 10,000 of them so far, starting with outlying areas of the state.

More info on the digital edition

Frequently asked questions about the iPad program

The digital subscription rate is $34 to $36 a month, regardless of whether the subscriber wants an iPad.

Hussman said he needs to convert 70% of subscribers from print to digital to make his plan profitable.

"It may not work," he said. "It's a risk, but it's a risk we're willing to take. We want to remain a viable journalistic enterprise in Arkansas and we don't see any other way to do it."

The alternative is not good.

Many newspapers have cut back on staff and printed pages. They've cut costs across the board, resulting in weaker news coverage, Hussman said.

"I don't think there's any long-term business success in doing that," said Hussman. "I think that's a dead-end strategy."

Some owners gave up and sold out.

Across the country, newspapers have been hollowed out by corporate raiders, leaving some cities with ghost newspapers that are largely devoid of journalism. It's called "vulture capitalism."

Hussman said he's too invested in Arkansas journalism to let that happen here.

"Can you imagine me doing that after I've been publisher of this paper for 44 years?" he asked.

Hussman said he wants to be a good steward and keep "robust journalism" alive in Arkansas. He doesn't plan to cut $1 from the newsroom, at least through 2020, according to his plan.

"We would like to add people in the newsroom," Hussman said. "If we could sell more subscriptions, then we could do more investigative reporting, more watchdog journalism."

With a digital newspaper, there's no cost to increase the size of the news hole, he said.

Cuts will occur elsewhere in the business, such as production and distribution. Hussman said he didn't have an estimate Tuesday for the extent of those cuts.

Hussman said the Arkansas Democrat-Gazette is losing money after being profitable for years. He said he's got to figure out a way to make the newspaper profitable again.

"Sometimes you've got to risk your business in order to save it," he said. "That's what we're doing. And that's kind of familiar territory. We did the same thing with the Arkansas Gazette."

Hussman was referring to the newspaper war from which the Arkansas Democrat-Gazette emerged in 1991. He shifted the afternoon Arkansas Democrat to morning and invested in the newsroom, eventually winning the war over Gannett, which owned the Gazette at the time.

Brent Powers, president of the Northwest Arkansas Democrat-Gazette, said he's watching what happens with the iPad distribution but there are no plans to change the distribution method of the Northwest Arkansas edition at this time.

Hussman is also publisher of the Northwest Arkansas Democrat-Gazette, which is distributed in Benton, Boone, Carroll, Crawford, Franklin, Johnson, Logan, Madison, Newton, Sebastian, Scott and Washington counties.

Rick Edmonds, a media business analyst with Poynter, a nonprofit school for journalists, sounded skeptical about the iPad plan.

"I think it's risky and expensive," he said. "I don't know, but I sort of say it remains to be demonstrated how much adverting would flow to that type of presentation."

Hussman began his digital experiment in Blytheville.

"It was a complete bust," said Hussman. "Out of 200 subscribers, we only got four."

Then, after the newspaper began providing iPads and training sessions, subscribers softened up. About 140 of the 200 made the digital switch, including a 93-year-old man who didn't have a computer, cellphone or iPad, Hussman said. The man had been reading the paper for more than 60 years and wanted to keep doing so. He's got an iPad now and reads it online.

Hussman said newspaper employees have been holding iPad sessions at public venues, but if subscribers can't get there, the digital team can visit them at home.

"We're going to smother people in customer service like they haven't seen in 50 years," said Hussman.

Larry Graham, vice president of circulation for the Arkansas Democrat-Gazette, said subscribers often come to the sessions with a negative attitude about the shift to digital.

"But after they sit down with our digital sales team for three minutes or an hour, they come out saying, 'Hey, this is pretty good,'" said Graham.

"If we can get it in front of them and show them the app, they love it," he said, referring to the computer application needed to read the replica edition of the newspaper.

Readers are particularly happy when they realize they can increase the size of the type on the iPad, Graham said.

Hussman said most readers seem to prefer the replica version of the newspaper to the website. He said other newspapers made a mistake by expecting readers to give up the print edition for the newspaper's website.

He cited The Times-Picayune of New Orleans, which was recently acquired by John Georges, owner of The Advocate, a daily newspaper based in Baton Rouge.

"The Times-Picayune asked people to change their reading habits from reading a newspaper to reading a website," Hussman said. "We're letting subscribers read the exact same format they're familiar with. I think that's one of the keys to why it's successful."

Subscribers in Hot Springs and Conway recently got letters about the digital shift. The print edition will soon end for them, except on Sundays.

Hussman said there are still a few counties in central Arkansas receiving the daily print edition. He said some details of the digital shift there have yet to be worked out.

"We're up to our ears in alligators right now trying to move from town to town and do all these meetings," he said, referring to his speaking to civic groups and the digital team training people on how to use an iPad.

Since February, digital subscriptions have included the delivery of a Sunday print edition of the newspaper, said Graham. He said that began with the digital shift for subscribers in Camden, Magnolia and El Dorado.

Hussman said the paper has been getting an 80% conversion rate in places where it has offered the print Sunday edition in addition to the digital paper.

"We were not brilliant enough to know when we started this that we should offer the Sunday paper," he said.

Graham said cities that were converted to digital before February don't receive the Sunday print edition, and it has yet to be determined if that will change. That would include Jonesboro, Blytheville and Mountain Home, among others.

Hussman said the Sunday print edition will be sold in newspaper racks and other locations around the state, in addition to being available digitally. He said most legal notices will be published in the Sunday edition.

The Sunday print edition, which is often stuffed with advertising circulars, is profitable, Hussman said. The rest of the week, the paper loses money, he said.

Subscribers who want only the Sunday print edition can get it for $32 a month, said Hussman, but they'll get the digital version with it whether they want it or not.

Hussman said Internet accessibility doesn't seem to be a problem, although the conversion rate in rural areas hasn't been as good as in cities.

"We're finding the vast majority of homes already have Internet," he said.

Hussman said the digital version of the paper will have several crossword puzzles. Readers can work them through the iPad keyboard, he said.

Hussman said some readers prefer to read the replica version of the paper on a desktop computer, which also can be done with a digital subscription.

After getting all the subscribers possible converted to digital this year, Hussman said representatives may go out next year and try to solicit new subscribers of the digital Arkansas Democrat-Gazette.

Metro on 05/22/2019

Print Headline: Democrat-Gazette out to shift print readers to digital by '20

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Comments

  • Testingonetwothree
    May 22, 2019 at 5:44 a.m.

    Many sites and people in Arkansas do not have easy cheap internet which is needed to access the “new” ark gaz dem. 70% retention is a pipe dream. He better sell it while it still has some value

  • RBear
    May 22, 2019 at 6:17 a.m.

    The cost of this solution is still too expensive at $32 or $34 or $36 or whatever the D-G settles on for a price (several different prices listed in this article, showing they don't have this figured out). Today, I was billed for by D-G and San Antonio Express-News subscriptions. D-G was $30 (apparently I'm not yet under the new pricing model) and the E-N was $15. I get more national news from the E-N and much more local content. They also still maintain a print subscription and continue to turn a profit so apparently they have the business model figured out.
    ...
    As I read through this article, even Hussman doesn't seem to have an idea what is a good model. When he talks about the adoption rates, the costs, and the expected revenue, it's like he's living in some alternative universe. 140 out of 200 subscribers in a captive market is not a good model to consider when working out a business plan. Then there are the questions of which markets will convert and which will not.
    ...
    Even more bizarre is that the NW Arkansas Democrat-Gazette may not convert even though they are a WEHCO asset. I thought WEHCO would have this figured out by now, but it looks like they are just making it up as they go. Hussman said he wants to go digital, but no one has a clue if that makes sense or if they even know how to execute the plan.
    ...
    So, here's the deal D-G. My price point is $15 for digital only, no iPad. San Antonio Express-News makes it work. NY Times makes it work. Washington Post makes it work for less. Austin American Statesman makes it work for less. If the D-G can't meet that price point, I'm out.

  • MBAIV
    May 22, 2019 at 6:48 a.m.

    Don't know if Hussman reads these posts -- but RBEAR makes a good point. If you are removing the costs for 6 days of print production and distribution, the price for subscribers should be less than it is now. You act as though all of your costs are in the office and not spread out as far as the print shop.
    .
    If my wife wants to do the crossword and other puzzles, which she does, I will have to print those at my cost. That will mean that the new electronic version will actually cost me more. Also, we often are both looking at parts of the paper -- two different devices now. We have extra devices - but the new iPad process doesn't really cover that multi-use.
    .
    The price I pay for the paper has gone up drastically recently - way more than anything else we buy - except maybe the obscene cost of healthcare and drugs. Did newsprint really go up that much faster than toilet paper or my printer paper? Really, that much more? I'll give myself a year or so ... but may become a non-DemGaz reader for the first time since the 50s.

  • BillMurray
    May 22, 2019 at 7 a.m.

    With all that money saved from paper, ink and gasoline, should it be a priority for ADG staff to get a pay raise?

  • Bullgod1984
    May 22, 2019 at 7:01 a.m.

    MBA, the iPad version let's you sign in to the app on multiple devices. So you and your wife can both look. And the crosswords are interactive. You can do them on your tablet.

  • RBear
    May 22, 2019 at 7:03 a.m.

    MBAIV hits at another great point. He says, "The price I pay for the paper has gone up drastically recently - way more than anything else we buy - except maybe the obscene cost of healthcare and drugs. Did newsprint really go up that much faster than toilet paper or my printer paper?" Very true. I noticed some substantial price increases each year since I picked up the subscription for my parents. Most likely, WEHCO is not listening to any of these comments and is just "taking the hill" for Hussman.

  • NoUserName
    May 22, 2019 at 7:07 a.m.

    When LR/Central AR goes all digital, it will have been nice knowing all of you since I think I lose the ability to read/comment online. I'll be out. I do most of my reading at the breakfast table. I've spilled enough drinks to know that is not conducive to a tablet. We've also got multiple readers - if you can read on multiple devices, why include the pad at all? And, as Bear points out, other papers are MUCH cheaper. I keep up with my hometown news for ZERO cost. I'll find other ways to get my AR news.

  • NoUserName
    May 22, 2019 at 7:08 a.m.

    Speaking of the price increases, I signed up for the ADG when I moved here - about 12 years ago. Price was $15/month.

  • nc72211
    May 22, 2019 at 8:12 a.m.

    Although I have no interest in the offering, I do wish you luck MR Hussman. I neither want nor would use an Ipad. I access the online version at my desk when time allows. My interest would be $10 to $15/mo online. I would think you have accumulated a sizable nest egg. It may be time to secure it.

  • Knuckleball1
    May 22, 2019 at 8:18 a.m.

    When talking to a young lady about my 95 Year Old Aunt's newspaper in South Arkansas, she could not understand that that my Aunt did not have internet, didn't want internet and didn't have a Smart phone. I tried to explain to her that Internet Service in the area was very limited when it worked.
    ..............................

    I asked her about getting the paper by mail, she said that was possible but it would be 4 days late. I asked her why 4 days late, she said that was just the way it was.
    .........................

    I explained to her that in the 40s, 50s, 60 and 70s till the Gazette went out of business that a paper had been delivered to my Aunt's mail box 6 days a week by her mail carrier unless it was a Federal Holiday and it was the current day's paper. That in 2019 the service would take 4 days, that was not good business. That a day late might be acceptable but not 4 days.
    ..........................

    They would deliver her a paper on Sunday for $8 a paper, I told her no thank you, it was not worth $8. So for the first time in about 80 years a paper is not being delivered to my Aunt's address in South Arkansas.

    .......................................

    It is hard to believe that the paper can't sell enough papers in the Central Arkansas area to keep a printed daily paper.

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